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  • Energy names sharply lower as oil dives below $70 [View news story]
    This site has allowed me to grow from a 5-figure investor to a 7-. Nothing sad or pathetic about that. Oh, and you're a jerk.
    Nov 28, 2014. 12:56 PM | 13 Likes Like |Link to Comment
  • Halcon Resources: Will The Tuscaloosa Marine Shale Be The Final Nail In The Coffin? [View article]
    I take a far more simple approach to HK. Look at what Floyd Wilson did at Petrohawk. The company was maligned, downgraded and kicked to the curb for a series of failures but kept searching for the next big thing and wound up being very early to the Eagle Ford. That poor, badly managed company sold to BHP Billiton for $15 Billion and its management and shareholders laughed all the way to the bank. HK's story reminds me exactly of Petrohawk's - stumbles here and there, general disrespect for the company and its management, significant declines, then left in the scrap heap...
    Of course, it remains to be seen if HK can "pull a Petrohawk" and finally find a way to be in the right place at the right time. The way new plays are being developed and new technology is making previously forgotten areas into hot ones, there seems to be a lot of opportunity for the HKs of the world that swing for the fences and have the resources to do it more than a few times.
    I like HK at $3.50. It may go lower, of course, but probably not much, and it may go higher, of course, and when it does, probably by a lot. That's a reasonable risk/reward scenario for any stock, but especially one with a management team that's been down this road before.
    Mar 21, 2014. 01:51 PM | 10 Likes Like |Link to Comment
  • Update: Memorial Production Partners' $150M Buyback Is A Huge Positive [View article]
    I wish you all knew the guys at MEMP as well as I do. No way John Weinzierl makes a public statement about something this important unless he KNOWS it's safe. It would be hard to exaggerate how careful and prudent these guys are, from their NGP backers on down. I have been in MEMP from the beginning and am loving this chance to grab some more at ridiculous prices. The hedges are real, the companies behind those hedges will stick, and even if they don't, MEMP can offset against debt. A truly beautiful arrangement, and there's no one else in the upstream MLP space that can compare. #Long and loving it!
    Dec 18, 2014. 04:17 PM | 8 Likes Like |Link to Comment
  • Apple: It's Panic Time [View article]
    On a micro level, where some of the best data is found: my 21 year-old daughter, a former sorority president and center of her social circle, just traded in her Android for an iPhone last week. It was her birthday and we told her she could get any phone she wanted and all she could talk about was finally getting an iPhone: "It's so much cooler than my HTC - it fits in my hand, the apps are ridiculous, and all my friends have them - now I can be in their message group!". She went to Best Buy to get it and they furiously attempted to convince her to buy the new Samsung, "Look at this screen", "Can you believe how big this screen is?", "Have you seen this screen?". My daughter said that it was as if the whole mobile phone section at BB worked for Samsung. She stuck to her guns, got her iPhone, and before the end of the day got a group message for a party that night and had downloaded an Apple app she'd always wanted, plus was able to sync it with her Mac.

    Oh yeah, you know she's a Mac user - like every kid at her college, by the time she was a sophomore she was left out of all the new software, apps and other cool stuff because she was one of the few kids who didn't have a Mac notebook. Needless to say dumped her Dell for a Mac, emptying her bank account for it, and has never looked back. Her 25 year-old brother did the same thing when he was in school - used his own money to trade in the Sony we gave him for graduation and upgraded to the Mac. I don't know about the rest of the world, but on most college campuses and for anyone under 35, you either go Apple or go home.
    Part 2 of my micro-level story: I got one of the first Samsung S3s and it was the worst phone I've ever had. It had lots of bells and whistles and I sure loved that big screen, but I've never had a worse phone for getting and keeping a signal. Standing side-by-side with any other phone user using the same cell service, they'd have four bars and I'd have 2, or they'd have 2 and I'd have no signal. Everyone I called complained I sounded like I was in a tunnel or underwater. After three trips to Best Buy and one complete replacement to no benefit, their "no lemons" warranty policy kicked in and I picked out a new HTC, which I have loved ever since.
    I'm long Apple, having dived in around $560. Hurts right now but I believe in this company and its almost creepy way of insinuating itself into the lives of its users. It's like tech crack, once you're into Apple you'll never get out, and it's viral - from the iPhone to the Mac to iTunes to the iPad.
    The virus may be sleeping for now, but like all real viruses it only takes a fresh outbreak to infect another large portion of the population. In the meantime, it's still in people's blood, and they're still adding to their Apple collection of devices. This is just a brief period of dormancy. As noted in comments above, this has happed 3-4 times in the past whenever Apple was in a brief inter-release lull, and each time it led to much rending of garments and gnashing of teeth. It may not be Apple TV this time but it'll be something. Few saw the iPad coming either.
    Jul 1, 2013. 01:15 PM | 4 Likes Like |Link to Comment
  • Equity outflows may be sign of a toppy market [View news story]
    There is now a strong consensus that Fed raises rates mid-year. Quarter point? Half point? It'll just be a blip, but psychologically there has to be some reaction to the first raise in years. This country's debt is NOT sustainable and so many of us are sitting around wondering when the chickens come home to roost.

    How many of us are sitting on 20-30% gains from the last few years? And we all know that we're going to have to lock in those gains soon and are more than ready to do it given half a reason. Half a point is half a reason.

    How many of us know or at least suspect that this aging bull market is past its expiration date? If it's only 20% of us, what happens when that 20% bail on the first threat of inflation? I know that I sit here every day with my finger poised over the sell button, and I'm guessing there are millions more doing the same.
    Mar 5, 2015. 12:30 PM | 2 Likes Like |Link to Comment
  • Among energy firms, a disconnect between Q2 results and stock movement [View news story]
    To expand on mjtroll's comments: NFX and XCO are not oilfield service and equipment companies. Both are pure E&P (exploration and production) companies. They are in the same general Energy sector of course, but their sub-industries are completely different. The distinction may be academic for investors and traders as the XOP and OIH are inextricably linked and rarely move independently. However, relative valuations do tend to follow more closely the sub-industry than the sector, just as they follow an independent company more closely than its sub-industry.
    Jul 30, 2014. 03:42 PM | 2 Likes Like |Link to Comment
  • Memorial Resource Development IPO Expiration Provides Hot Buying Opportunity [View article]
    Don - I appreciate you letting us know when these new issues arrive and when the quiet period is set to expire. That can be a solid lead to a great buying opportunity on a conceptual level.

    I recognize this article as being very similar to the one you published a few weeks ago about Parsley Energy (PE). Same concept, same recommendation, same type of company. But that never worked for PE as the underwriters came out with either Hold or Outperform ratings and the stock tumbled 7-8%. Considering that they had every reason to promote that stock, a Hold rating was quite damning, and chased me off the stock for good.

    That probably won't happen here. I agree that MRD has a great chance at being a success. Unlike PE, its management, backers and associated companies are all proven winners.
    Jun 26, 2014. 06:07 PM | 2 Likes Like |Link to Comment
  • Quiet Period Expiration For Parsley Energy Offers New Buying Opportunity [View article]
    As a 30+ year participant in the financial and operational sides of E&P, I've spent many hours observing and analyzing the difference between the generations. Houston is filled with multi-generational oil and gas guys, and I think I can count on one hand the number of sons or grandsons that have made good over a prolonged period of time. Certainly there are the Jeff Sandefers that got a boost from dad, made a quick pop and got out with some serious cash, but there are so many others I won't name that got the same boost, enjoyed the ride for awhile, but then found out that it was a lot of hard work for a really long time and just couldn't handle it.

    Having said that, I love PE's business plan. Vertical and now horizontal wells into multiple stacked pays in one of the hottest basins in the world - nice! I was all set to dive in until I saw who was running it - and I don't know the young man at all - but a 3rd generation silver-spooner has me on the sidelines. This is patently unfair of me, just as it may be equally unfair to assume that his family DOES give him an edge. We should all be given every opportunity to prove that we're our own man and capable of making it on our own.

    And then I read that he started with 100 wells he got from Grampa. After working as an operations tech for Dad. Just exactly how well would he have done in the world if he hadn't had their help, and how much can they help him now? Guess we'll all find out.
    Jun 6, 2014. 06:01 PM | 2 Likes Like |Link to Comment
  • Southern Copper (SCCO) is considering closing its foundry and refinery in southern Peru because it doesn't think it can comply with limits on sulfur dioxide emissions that will take effect next year, an internal document says. It's unclear how such a closure would affect SCCO's annual copper output, estimated at 650K metric tons this year. [View news story]
    I take this as nothing more then SCCO letting the Peruvian government know that harsher regulations will hurt business. It's clear from the press release that they've been arguing this with the regulators for some time now and this is the next logical step in the negotiations. Releasing the information via a memo to the staff is a time-honored way to let the world know what could happen if the regulations aren't loosened or delayed.
    Jul 5, 2013. 06:00 PM | 2 Likes Like |Link to Comment
  • Going All-In On SandRidge Energy [View article]
    I've weighed in on SD before. I know the company, the assets, the history and the man. I never touched this stock and I never will.
    Jan 8, 2013. 06:36 PM | 2 Likes Like |Link to Comment
  • Panic-selling in income producers (I, II) infected the BDC's as well, notably Main Street (MAIN) and Triangle (TCAP), both down more than 10%. Fed meddling seemingly can't hurt their returns, but most names in the popular sector trade well above their net asset values (MAIN is 57% above Sept. 30 NAV after today's decline, TCAP 47%), making them vulnerable to a change in sentiment even if business is doing fine. [View news story]
    Nothing but doom and gloom, but not just because Obama won. We all knew that that was reasonably likely, or at least anyone who could read the news with an impartial eye could. All of the last week's value destruction can't be just the result of us finding out that the polls were right, so what is it?

    Consensus is building that it's a combination of three significant factors: 1) Germany's weakening economy threatens all of Europe's solvency, 2) the election confirms that we'll spend the next four years minmizing our chances of economic recovery from this most-anti business administration, and 3) less than thrilling earnings reports. Germany and the earnings take out tech, earnings and the negative tax implications disrupt MLPs and REITs.

    There will be pops when there is consensus on how to raise taxes ("if" was decided November 6th), and particularly if there's any agreement on managing entitlements. Increasing the federal debt limit and pushing back the fiscal cliff will help stabilize people's attitudes, but will it be enough? None of that will make Germany any stronger or improve next quarter's earnings reports, but at least settling one of the three factors should give us a fighting chance.

    Until those things come to pass and the impact on the markets is clear, I agree with tampat - stay away for now, let this baby settle. It could be another 2-3 months of steady declines.
    Nov 14, 2012. 06:34 PM | 2 Likes Like |Link to Comment
  • McDonald's Has Lost Its Way, Will We Ever Love It Again? [View article]
    It's McDonald's. McDONALD'S! One of the largest and most successful stories in American corporate history. No one is going to replace food with something digital, as happened to Kodak. Food is here to stay and McDonald's will prove again that they're a relatively fast adapter. This is like when everyone decides Apple is over and the stock goes down 20% - you just buy it!
    Feb 18, 2015. 11:07 AM | 1 Like Like |Link to Comment
  • A Diversified, High-Income Bond Portfolio For 2015 [View article]
    This is a well-researched article with a lot of useful information. As usual, whenever I read anything about bond funds, I wonder why more isn't written about NQM (Nuveen Investment Quality Municipal Fund). I've been in this for years and it meets and exceeds many of the criteria of the funds recommended above. Year in and year out, through bull and bear markets, NQM generates about 6.5% TAX FREE income. I don't have the financial sophistication to argue more specifics about this fund, so I will be very interested in any comments that relate NQM to the funds listed above.
    Jan 25, 2015. 07:22 PM | 1 Like Like |Link to Comment
  • Memorial Production Partners: Can The Distribution Survive $60 Oil? [View article]
    Brandond - Read further up for an answer to your question about creditworthiness of MEMP's hedge partners.
    Dec 16, 2014. 06:27 PM | 1 Like Like |Link to Comment
  • Seadrill Ltd.: My Game Plan For Tomorrow [View article]
    Ernie Mac - This is one of the most cogent, useful explanations of anything I've ever read on this site, or anywhere for that matter. You need to be writing how-to books for investors, or start a website or something. Seriously, this is some high quality educational information. I'm a follower from now on, can't wait to see what else you can teach me!
    Nov 30, 2014. 02:21 PM | 1 Like Like |Link to Comment